Maurice Tutor

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    Argosy University/ Phoniex University/
    Nov-2005 - Oct-2011

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    Phoniex University
    Oct-2001 - Nov-2016

Category > Accounting Posted 16 Aug 2017 My Price 12.00

Austin, Texas.

4-35    Overhead Rate, Pricing Norton Associates is an advertising agency in Austin, Texas. The company’s controller estimated that it would incur $325,000 in overhead costs for 2010. Because the overhead costs of each project change in direct proportion to the amount of direct professional hours incurred, the controller decided that overhead should be applied on the basis of professional hours. The control- ler estimated 25,000 professional hours for the year. During October, Norton incurred the following costs to make a 20-second TV commercial for Central Texas Bank:

 

Direct materials                                                   $32,000

Direct professional hours ($50/hour)                                 1,200

 

 

Actual overhead costs to make the commercial totaled $16,500. The industry customarily bills customers at 150 percent of total cost.

 

Required

1.    Compute the predetermined overhead rate.

2.    What is the total amount of the bill that Norton will send Central Texas Bank?

Answers

Maurice Tutor
(5)
Status NEW Posted 16 Aug 2017 07:08 PM My Price 12.00

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